Tag: Crowdfunding

You did it! You hit the magic number, thanks to a successful crowdfunding campaign built on preparation, a compelling video, strong promotion and a savvy campaign page. Give yourself a pat on the back and save some energy, because once the buzz of your successful campaign fades, you’ll quickly realize you are accountable to hundreds, if not thousands of contributors, rather than a few VC board members.

SkyBell raised over five times our funding goal with thousands of backers in 50 countries. We entered the development phase looking to turn our home automation concept into a reality, and quickly realized our success depended on our ability to execute our vision and fulfill our orders. It wasn’t easy, but these four principles helped us launch successfully — and turn our own crowdfunded product into a sustainable business.

Tip 1: Stay Focused on the Product

One of the great outcomes of a crowdfunding campaign is the feedback you receive from backers and the public. Take every opportunity to document this feedback, but also consider how implementing a new feature may impact your timeline, costs and core offering. Be more conservative, as adding features after the campaign can push you beyond the committed delivery date of your initial concept.

It’s also tempting to entertain ideas for second product versions, distribution and other opportunities too soon. Take the time to assess these opportunities yet stay aware of how they impact your short-term fulfillment capabilities. Your objective is to ship your product. Then, focus on growing from a successful launch.

Tip 2: Keep Your Backers in the Loop

Your backers share your vision and passion. Even though they are not investors in the traditional sense, backers are a part of the journey and will want to participate as much as possible.

The key to keeping backers happy is communication. Even when we thought we were communicating consistently, it still wasn’t enough. While it’s easy to get bogged down in development or conserve your message for proprietary reasons, make every effort to provide detailed updates on a frequent basis. This will assure your backers that things are rolling and that it’s all part of the crowdfunding process.

This becomes particularly important if your launch date pushes out. On average, crowdfunded projects that fulfill their perks do so 90 days after the original target date. If you don’t communicate enough during the development phase, you could see a turning point where backers become anxious. We learned that the best approach is to share as many details as possible and keep communication consistent. This gives you the best chance of keeping backers positive leading up to the launch.

Tip 3: Plan Ahead for Customer Support and Bug Fixes

In a perfect world, every launch goes exactly as planned and users sing your praises. The reality is that all startup product launches have bugs. Your team will be small due to operating on discounted funds from your campaign. This puts extra pressure on creating an efficient customer service strategy.

Break your support efforts into web support, customer service and bug reporting. First, your website should have documentation, FAQs, photos and videos on how to use the product or service ahead of the launch. Make sure it is easy to find. Second, document potential issues and their solutions for your customer service team so they understand how best to help customers. Third, create a plan to record bugs from users, consolidate them for the development team and to communicate fixes to users via updates and customer service team.

Remember, your backers will expect a few bugs and they’ll be thrilled if you have the resources ready to solve problems quickly and efficiently.

Tip 4: The Bridge From Campaign Funds and Your Next Round

Your ability to cultivate a second income stream quickly after launch could be the difference between a thriving business and fifteen minutes of fame.

For most crowdfunded startups, there comes a time when your initial funds run low. This can happen before or just after your launch. The result is a gap between your initially crowdsourced funds and your next round of funding. Financing will likely not be an option.

The key is to identify additional revenue sources that will help you obtain new orders after launch. If you offer hardware and media perks, consider selling direct on your website and on Amazon.com. If you developed software, try to regenerate the buzz from your campaign and drive sales on your site.

There’s no doubt that crowdfunding has created new opportunities for startups that could never have been possible otherwise. From start to finish, it’s a great vehicle that makes innovation possible and allows you to build a sustainable business. To get there, you’ll have to carefully navigate the post-campaign phase to strategically position yourself for long-term success.

Andrew Thomas (@apthomas) is co-founder of SkyBell – a home automation startup pioneering a Wi-Fi video doorbell that allows users to answer their front door from a smartphone. SkyBell raised $585,000 through Indiegogo and was named a 2014 CES Innovations Award Nominee. Andrew specializes in marketing and mobile user experience design for product and software development. Andrew speaks and writes on topics including home automation, crowdfunding and startups.

The Young Entrepreneur Council (YEC) is an invite-only organization comprised of the world’s most promising young entrepreneurs. In partnership with Citi, YEC recently launched StartupCollective, a free virtual mentorship program that helps millions of entrepreneurs start and grow businesses.

Choosing which to get involved in as a mentor, investor or connector is becoming easier as my personal network grows (many thanks LinkedIn) but more importantly because the ability to mitigate risk and prove viability quickly is becoming easier.

In short, let’s quickly discuss new opportunities available to shorten the window of time needed to get seed stage capital, minimum viable product, and secure beta clients.

Crowdfunding Seed Stage Capital

Let’s face reality. Crowdfunding is the future, and if the SEC will ever get out of the way and allow equity crowdfunding to the masses, our current recession would be over in no time. In the meantime, while the regulators argue about how we can spend our money, let’s talk about leveraging this option to both raise initial seed capital to get proof of concept.

Putting together a great campaign is a skill in itself. It requires creative thought, excellent planning, significant time spent on PR strategy and connection with social media influencers. If you are able to put these pieces together with a great product or service, then communicate it well to the target demographic, it is reasonable you can get enough funding to build your proof of concept.

In the end, it boils down to your social media influence and public relations. If those two are accounted for, your chances of success are reasonable.

In the meantime, don’t forget to put as many things in place prior to the end of the campaign you will need to build the MVP. Whether that be vendors, manufacturers or advisers.

Building Minimum Viable Product

Now let’s assume your crowdfunding campaign was a success.

In the age of 3D printing, access to manufacturing globally and web/mobile development advancements, it never ceases to amaze me how so many startup founders REFUSE to quickly build an MVP (minimum viable product) and get to market.

If your campaign is a success, you have a potential customer base built in by default. Not only can you leverage the buzz created, you also have the ability to communicate with these potential customers and get their feedback on what they would like to see. Instead of hiding everything from them until launch, just ask questions.

It is better to make modifications prior to launch, than wait for the bombardment of feedback when you are slammed with customer service, fulfillment and the other headaches which come with company growth. Making pivots is a blunt reality in business. It is better to account for them as early as possible.

Leveraging Beta Clients

Growing your business requires getting an initial client base, whether you call them beta clients, early adopters or just plain customers.

By going the way of crowdfunding and heavy engagement with your backers, you have the opportunity to build a loyal customer base full of brand ambassadors. Not only is this vital to growing the company in the short term, in context of raising additional capital, being able to showcase a rapidly growing customer base enables proving market viability to investors.

While many investors shy away from crowdfunded projects in the early stages, this position is rapidly shifting as acceptance of crowd based idea validation expands. If you are able to prove how many backers have turned into ongoing customers, you now have an extremely valuable weapon at your disposal.

Accelerating Traditional Capital Raise

Since it realistically takes 6+ months to raise seed stage capital for 99% of startups, it makes sense to spend that same amount of time planning out your crowdfunding campaign with the next step goals as outlined above.

Not only does this enable you to be further down the road prior to raising traditional capital, you also have a much stronger position in equity negotiations and might not even need it. Investors are looking for proof of concept, minimum viable product, initial customer base and growing revenue. All of these are signals of risk mitigation on their investment.

By strategically leveraging crowdfunding, you have the opportunity to both accelerate growth of your company and the time spent raising additional capital. When risk is lowered, you will be amazed at how quickly the doors can open up.

This is just a top level of things to think about when planning your entrepreneurial journey in today’s world of opportunity. I would appreciate your feedback and ideas you can share with others getting ready to make the leap!

Those of you familiar with crowdfunding know it’s quickly evolving into an industry itself. In fact, crowdfunding is predicted to create at least 270,000 jobs and inject $65 billion into the economy by 2014’s end.

As an entrepreneur (current or aspiring), how can crowdfunding help you grow your business? To find out, it’s helpful to understand the trends driving the most successful campaigns and to choose the right platform for your project.

Entrepreneurs can take advantage of these three big crowdfunding movements:

The Rise of the DIY Entrepreneur

In the past, entrepreneurs with business ideas relied on venture capital or raised seed funding from friends and family. Crowdfunding offers an advantage traditional methods don’t by providing validation as well as money. A successful campaign shows that there’s a market for what you offer. Getting additional funding is easier once an idea is proven viable.

For example, Bluff Works, a wrinkle-free men’s pants company, had over a thousand backers on Kickstarter and raised more than $128,000 — far exceeding its $13,500 goal. Its founder used the campaign to conduct market research and learned that customers wanted black pants, something he hadn’t considered when launching the campaign.

Leveraging an Existing Network

Another emerging trend is using your existing network to jump start a campaign. This works for entrepreneurs, writers and artists with devoted followings who are invested in what you have to say.

People enjoy the “story behind the story.” A behind-the-scenes look at what you intend to create increases your likelihood of getting funded. After losing her child, Angela Miller built support for her book by sharing her story on social media. Her campaign garnered 217 supporters (70 percent strangers) and raised $12,978 on Pubslush.

Funding Tech, Apparel and Video Production

Cutting-edge gadgets do especially well on crowdfunding sites. The Pebble Smartwatch raised over $10 million on Kickstarter, for example.

Fashion also gets a lot of coverage in the crowdfunding space. Stantt, a casual shirt company, raised cash on Kickstarter and was able to offer over 50 sizes, thanks to precise body measurements and 3D body scans.

Producing films costs a lot of money, and crowdfunding mitigates some of the financial risk. The “Veronica Mars” movie projectshattered Kickstarter records when it raised more than $5.7 million from 91,585 fans of the canceled show.

If your project fits into one of these categories, it’s made for crowdfunding. Even if it doesn’t, you can see what made these campaigns succeed: A real user need (Pebble), dissatisfaction with current offerings (Stantt), and a cult-like following (“Veronica Mars”).

Choosing the Right Platform for Your Campaign

Before setting up your campaign, evaluate the platforms available and weigh the advantages of each.

Kickstarter: This company specializes in creative projects (films, games, music, art, design and technology), all of which remain fully owned by their creators. The funding is all or nothing, meaning you must raise the entirety of your goal to receive any money.

Indiegogo: Geared toward the international community, Indiegogo supports 224 countries and territories, five currencies, and four languages.

Crowdfunder: Crowdfunder connects investors and entrepreneurs in film and entertainment, small business and technology. It serves North and South America and accepts minimum investments of $1,000.

StartSomeGood: This site specializes in social entrepreneurship and allows you to set a Tipping Point Goal (what a project must raise to make an impact) and an Ultimate Fundraising Goal.

Once you’ve chosen a platform, position your campaign for success.

Learn from other campaigns. Review the most successful campaigns on different sites to see what worked. What wording did they use? What rewards were offered? How much interaction did the users have with backers?

Get advice from those who’ve been there. Reach out to individuals who’ve run successful campaigns. Ask what worked well, what they’d do differently, and what insider tips they can offer.

Develop a pre-campaign strategy. Campaigns that gain 30 percent of their goal within the first week are more likely to succeed. Get between 30 and 50 percent of your supporters in place before launching your campaign.

Crowdfunding opens a world of possibilities, but it’s not an easy out or a guaranteed way to get funding. But if you do your research, choose the appropriate platform, and promote your campaign before its launch, your odds of success are much better.

Amanda L. Barbara is the vice president and co-founder of Pubslush (www.pubslush.com), a global crowdfunding and analytics platform for the literary world. Follow on Twitter

The Young Entrepreneur Council (YEC) is an invite-only organization comprised of the world’s most promising young entrepreneurs. In partnership with Citi, YEC recently launched StartupCollective, a free virtual mentorship program that helps millions of entrepreneurs start and grow businesses.

Phil Schmerling talks to Dr. Cornwall about his exciting company — InCrowd which is one of the first serious crowd funding platforms to emerge. He gives some interesting insight into the near future of investing in startups and angel funds.

Running a crowdfunding campaign is like living one year of a startup on steroids. You need to create a concise story for why folks should support you. Your team must execute a video (not an easy task). And most importantly, you have to hustle every day to get in front of new audiences; unfortunately, people won’t just show up, no matter how amazing your product is.

After going through the experience myself, I am starting to believe that all entrepreneurs should do a campaign as well. Whether you use a major site like Indiegogo or Kickstarter, or even some of the awesome up-and-comers like Teespring and Crowdtilt, executing a crowdfunding campaign will put your team and business through the fire and back.

Here’s why we decided to bite the bullet — and some advice for other entrepreneurs who might be considering a campaign of their own.

Our Story

Modify Watches just launched our first-ever Kickstarter campaign in February to produce something we have titled “Mod-to-Order.” At 4-year-old Modify, we design interchangeable wristwatches, and our vision has always been to allow people to wear their passion on their wrist. If you want a photo of your kid or an image that represents your wedding or a gift for your employees, we want to provide it to you. But to date, it’s been too costly to offer.

After a few years of crowdsourcing products from our fans — “Which of these 10 designs should we produce?” — we’re now using crowdfunding to validate that fans actually want to produce genuine, one-off custom products. We’ve been ignoring Steve Blank’s mantra to get outside of the building, so we figured we would go all-in and choose a make-or-break path; we’ll only be able to offer this IF our Kickstarter campaign is successful.

Why Crowdfunding?

I truly believe that there is no better way to validate that you have a market than by releasing your product and saying “buy now.”

In crowdfunding, you are telling folks, “We want this thing to exist, but it can only happen if you fund our vision.” If early adopters won’t fund you, either your idea isn’t all the way there, or you’re not ready to execute.

One week into our own campaign, and we’re 30 percent of the way to our goal. Our team is staying up late every night to do all of the “real” work we have after spending the 9-to-5 emailing everyone we know asking them to share our campaign.

Kickstarter or Indiegogo?

If you’re going to use one of the big-name crowdfunding sites, there are some definite pros and cons to consider.

Kickstarter has an incredibly strong brand name; even folks who don’t know what crowd-funding is have heard of Kickstarter. Oh, and they just funded their one billionth dollar. We chose the platform because of its historical strength in consumer goods.

In retrospect, Indiegogo would have been an amazing choice too. That platform has an incredibly strong name for artists, is growing in product and has a strong customer service bent. Most relevant, they have many fewer restrictions, which means that you can tailor your campaign more to your company’s specific needs. Indiegogo also has a new tool called Outpost, which allows you to embed your campaign on your site.

The Video

The most important part of your campaign is your video. It’s also one of the more time-consuming aspects of running a campaign like this.

To produce our video, we worked with the awesome team from Six Finger Films. We story-boarded, collected assets, engaged our fans to help tell our story, and shot the film over two days.

If you can’t do the video in-house, I strongly recommend that you find a partner that believes in you and cares about your vision and story.

What We Would Change Next Time

We’ve already learned a few lessons that could benefit other entrepreneurs. Next time, we’d do these things differently:

Contact press a few weeks in advance of launch, instead of on the day. It takes a while to explain your value, and reporters and bloggers are busy! Invest in them like you would in any partner.

Shorten our video. Our video is about 4 minutes long. It’s an incredible marketing tool — but we don’t get to the point of the campaign until 90 seconds in. By that point, you want to have already inspired the viewer to take action.

Simplify our reward tiers. Backers need to take time to understand what they get. That’s a major no-no. If they’re ready to give you support, make it easy with a clear value proposition.

Is It Really All-Consuming?

Yes. The key to crowdfunding success is that you engage your own network. That means personal emails appealing to all of your friends (and even acquaintances).

What I conveniently forgot was that we still had plenty of work to do for the ongoing Modify business – launching our new website, getting ready for Opening Day with our Major League Baseball watches and delivering great service to all of our current customers.

My adviser Bhavin from the Magoosh team always says that fundraising is a full-time job, so a co-founder should “quit” other parts of the business during the funding cycle. Personally, I have found this campaign to require even more work than raising our first round.

Nevertheless, while crowdfunding may seem daunting — it certainly does to me, only halfway through our campaign! – it’s still been an amazing experience. You get to interact with folks on a daily basis and your team has to come together for a very distinct shared goal. Most importantly, if you’re successful, you get to see your vision come to life with the support of fans who care.

Editor’s note: The author is pictured on the far right in the photo above, along with some other members of the Modify team. Check out their Kickstarter campaign here.

Aaron Schwartz is Founder and CEO at Modify Industries, Inc., which designs interchangeable custom watches known as Modify Watches. He loves working on startup ideas and has spent innumerable (happy) hours advising friends and former students on how to grow their ideas.

The Young Entrepreneur Council (YEC) is an invite-only organization comprised of the world’s most promising young entrepreneurs. In partnership with Citi, YEC recently launched StartupCollective, a free virtual mentorship program that helps millions of entrepreneurs start and grow businesses.

Yesterday crowdfunding site Fundable announced the acquisition of LaunchRock, the online service that helps businesses build an audience before they launch. The deal was finalized in an undisclosed amount of cash and stock, and LaunchRock employees will join Fundable in their Columbus, OH, offices. All 42 investors in LaunchRock will now become investors in Fundable.

With 5 employees, 42 investors, and a free product, the acquisition smells like a LaunchRock bail out. Not saying that’s a bad thing, though. LaunchRock obviously did a great job at building an audience for themselves, with a reported 10 million signups for their service. If an acquisition bails them out and helps them monetize, all the better for the folks that love the product.

Fundable isn’t getting a bad deal, either. In a crowded crowdfunding space, the company has been chugging away at building campaigns specifically for businesses. While Indiegogo and Kickstarter excel at raising funds for projects or charity campaigns, Fundable has been trying to help fund actual businesses. You know, those things with payroll and profits?

“Crowdfunding 2.0” Fundable CEO Wil Shroter told me on the phone.

“The first version of crowdfunding was Indiegogo and Kickstarter,” he explained. “It worked great for projects like albums or for charity campaigns. Projects aren’t when you need to pay payroll. When you start to do it for a product it breaks down, because the more you sell the more you need to be a company.”

Shroter pointed to former Kickstarter successes like Ube, Cregle, and Uncharted Play, who all moved to Fundable to raise expansion capital after their initial crowdfunding ran out.

So how does LaunchRock fit into all this?

For now the 2 services will be completely separate, but eventually they will be streamlined into one user experience. Users will always have the option of using one or the other or both. Shroter sees the 2 services working perfectly together, though.

“LaunchRock builds an audience. People use LaunchRock for validation, which is awesome. Fundable works best for companies who already have an audience.”

The acquisition will also allow Fundable to have a bigger footprint in their market. Many LaunchRock users expressed a desire for crowdfunding, but the company had no way to meet their needs. Now they will be able to seamlessly move on to Fundable. At the moment, Fundable hosts a few hundred campaigns at a time. (The average raise amount is $175k, 12X that of Kickstarter.) Shroter estimates that with the addition of LaunchRock users, the number of campaigns will jump to the the 1000s quickly.

Dyslexia is a common disability that is getting more attention in recent years. 1 in 5 people have dyslexia, which makes it hard to succeed in classrooms that demand every child be able to read at a certain level and at the same pace as their peers.

Yet, in our technology-centered world, there are no unobtrusive aids to help students with dyslexia. Most of the available products are clunky, drawing attention to the fact that the child using it has “a disability.”

When Kris Parmelee’s middle son was diagnosed with dyslexia, she soon learned the struggles they would face in the classroom. He was often pulled out of class for “special help,” or had to lug around equipment meant for adults with visual impairments.

Not cool, Mom!

Kris’s search for an unobtrusive solution that would allow her son to stay in the classroom with his friends came up empty. Such a solution just didn’t exist.

So, she made one.

Along with partner Mark LaFay, Kris conceived of an app that would read aloud that ONE word a child was struggling with so he could move on. Originally conceived for Google Glass, the app has now also been developed for iOS and Android smartphones. After all, every kid has a phone these days.

The app works like this: a child is reading something, say the instructions on a big test, and comes across a word they aren’t able to figure out. With DCODIA the child can take a picture of the word, sentence, or paragraph and crop it down to the words that are giving him or her trouble. They click “send,” and a few seconds later the word is read through their earbuds.

The paid version of the software also includes word storage, which could be a valuable data point for both individual families and dyslexia researchers.

DCODIA is an elegant solution to a widespread problem. Like I said above, 1 in 5 people have dyslexia. That means many of you have probably struggled with the condition and the stigma that comes with “not being able to read.”

There could be some challenge in adoption because many schools still do not allow kids to use their phones in school, even if the kids are technically allowed to have them. While many high schoolers are happy to flaunt these rules, younger kids have less freedom. Being the one kid allowed to use his phone could be as obtrusive in some situations as current dyslexia aids.

The solution to that problem is–hopefully–only a matter of time, though. It won’t be long before schools begin to utilize the super computers in their students’ pockets.

With adoption obstacles aside, DCODIA is one of those wonderful, change-the-world and help people kind of projects that I’m particularly partial to.

Recently, I a friend of mine was crowdfunding his next album on Kickstarter. The page debuted, and we all watched anxiously for a month as the funds trickled in. He was always relaxed and calm about it, but his wife would quietly tell me, “I’m so worried!”

The final day of the campaign, Seth still lacked almost half his goal. My husband and I were traveling at the time, but I kept the campaign site pulled up on my phone and hit refresh somewhat obsessively. We were out having drinks with friends when I interrupted the conversation, wildly bouncing in my seat and waving my phone in my husband’s face.

“They did it!!” I yelled, right there in the lobby of the fanciest hotel in town. “They reached their goal!!”

The Copenhagen-based startup is making a wireless HDMI dongle that will stream content from your computer to your TV. With 29 days left in their Indiegogo campaign, they’ve already almost doubled their goal.

AIRTAME looks a lot like Chromecast. Like the Google product, it plugs into the TV and uses Wifi to stream content. Chromecast can pull content from smartphones and tablets, but AIRTAME doesn’t have that capability. Yet, anyway.

However, AIRTAME does allow for wireless connections to projectors and to other PCs. Use cases for this include the ability to see a professor’s presentation right on your computer while you take notes or the ability to share presentations across screens during a meeting.

“We believe that everyone should be able to connect to the TV in the living room or the projector in the conference room–wirelessly,” co-founder Brian Kyed said in a statement announcing the Indiegogo campaign. “Therefore AIRTAME works with Mac, Windows, and Linux–so no one is left to use screen cables anymore.”

Considering the massive amount of support AIRTAME has received, it’s a safe bet there’s some demand for their product. Of course, reaching your goal does not a successful campaign make. Many hardware companies hit snags when it comes time to deliver, and we have yet to see if AIRTAME will fall in that camp.

There’s also the whole competing with Google and Apple thing. Not impossible, but very, very hard. My favorite in the TV streaming race is Apple TV because of the licensing deals they are working out with companies like Disney and ESPN. I also kind of love that it’s not dependent on my computer.

AIRTAME could really stand out, though, if they let the TV streaming thing go and focus on the business, classroom, and presentation uses of the product. None of the competition works quite the same way.

The Indiegogo campaign is still live, and last time I checked they still had a few openings in the beta test. That particular perk sold out so fast, they decided to open up another round of it.

Equity crowdfunding (ECF) will change considerably by the end of 2014. The introduction of Title II of the JOBS Act on September 23, 2013 gave entrepreneurs the ability to publicly advertise their need for funding. Title III is expected to become law in the spring of 2014 and will provide entrepreneurs with a much greater investor pool, as unaccredited investors will then be able to participate in ECF.

Once the JOBS Act is passed in its entirety, ECF will become the predominate method entrepreneurs use to raise capital for their endeavors. With these major shifts in the financial markets, some important occurrences are predicted to emerge throughout the year, with the top five being listed below.

2014 Predictions in Crowdfunding

1) Up to $1 billion in equity transactions will occur worldwide in 2014 based on industry trends from the past two years.

The 2013 crowdfunding report by Massolution stated that around $5.1 billion in transactions occurred globally in 2013. That’s around a 100 percent increase from 2012 when $2.6 billion was raised. The report also stated that $204 million was from ECF. Assuming that the global crowdfunding market will again experience a 100 percent growth rate next year, and regulations will allow for more people to participate in ECF, ECF could produce between $500 million to $1 billion transactions in 2014. This is especially true as more investors realize the potential ROI in ECF.

2) Equity crowdfunding will become a global phenomenon as countries begin to utilize it to maintain their economic competitiveness.

In some countries such as Finland, the United Kingdom, and Italy, ECF is already legal. The United States is also well on its way to legalizing ECF by adopting Title III of the JOBS Act. This law will allow almost any investor to participate in ECF sometime next year. Global participation in ECF will eventually occur as more countries develop laws to deal with the legal matters revolving around ECF.

A new report produced by Richard Schwartz for the World Bank estimates that the annual total market potential of the entire crowdfunding industry would average around $300 billion by 2025. China’s potential could reach $47.6 billion, while Europe and central Asia could reach $13.8 billion.

3) Title III of the JOBS Act will be implemented by the SEC by mid-year in the US, but will be slowly embraced by the industry due to its complexities for platforms and users.

The SEC proposed rules for Title III of the JOBS act on October 23rd. Once approved, it will allow non-accredited investors to participate in equity crowdfunding. Title III will introduce a new crowd to ECF; however, due to regulations and limits on how much an entrepreneur can raise, it will not be used as much as Title II in 2014. For example, it is likely that entrepreneurs who use Title III will only be able to raise $1 million in funding, and crowdfunding platforms will be required to register with the SEC. Title III will eventually be noted as a major milestone for the crowdfunding industry, just not in 2014.

4) In North America, more than half of companies using equity crowdfunding platforms will use the new Title II rule to advertise their need for funding.

Title II of the JOBS Act was introduced earlier this year on September 23, 2013. It lifted the 80-year-old ban on general solicitation, allowing business owners to publicly advertise their need for funding. According to EquityNet’s data, about half of the new companies listed on the site are utilizing Title II to reach a broader audience of investors. More entrepreneurs will likely begin to adopt this rule in 2014.

5) Many ECF platforms will no longer be in operation by the end of 2014.

The market share will eventually gravitate to the leading platforms with the largest populations and most advanced crowdfunding tools. This means that as 2014 progresses, the industry will experience a shakeout. Some sites may have difficulty complying with new regulations. Other sites may decide may wait for regulations to become finalized. Either way, situations like these are challenging for any company operating in the crowdfunding industry. In fact, sites like fimbex and crowddiligence are already no longer in operation. More will follow by the end of 2014.

Judd Hollas is a pioneer in the field of crowdfunding with multiple patents granted for web-based capital marketplace systems. He is the founder and chief inventor of EquityNet and continues to lead the Company’s efforts to create and introduce innovative new products and services.

Modern society is inherently visual. Multimedia content creation and digital innovation go hand in hand as entrepreneurs search for alternative storytelling methods that will distinguish them among the increasingly competitive and cluttered landscape of startups and ventures. Consumers are no longer making purchasing decisions simply by product. Rather, consumers are searching for brands with an appealing and vivid narrative. The easiest method for organizations and brands to illustrate their story is through video. Moreover, succinct and well-executed videos have the potential to go viral and simultaneously elevate brand awareness and online interaction.

YouTube, one of the premiere sources for online video sharing, accounts for 25 percent of Internet search traffic. As a result, YouTube videos, along with other online video tools and platforms, are not only being used to drive successful marketing campaigns, but also to drive successful fundraising campaigns as well.

Social Media marketers and entrepreneurs understand that multimedia campaigns with compelling video are more likely to attract more customers and investors to raise capital through crowdfunding.

In order to translate YouTube viewers into active campaign donors, however, it is essential that content creators utilize YouTube’s full capabilities and networks to achieve greater success.

Annotations on YouTube are simply text layers that can be placed anywhere in a video and be linked to an external page such as your crowdfunding campaign. You can add direct links to specific video times and grab your viewer’s attention as they pop up on the side.

Tip 3: Add Links to Video Descriptions

This tip seems so simple, yet it’s easily forgotten. Link to your campaign page through all available video descriptions, particularly your pitch videos. If your campaign links are lengthy, use a URL shortener (like Google’s at http://goo.gl/). Make sure you link to the campaign right at the beginning of the descriptions, so it appears above the fold. Link format: http://www.mycampaignurl.com.

Tip 4: Engage Your YouTube Subscribers Through Feed Updates

Consistency is one of the most essential factors of a successful campaign. Keep your YouTube subscribers engaged through your channel feed by posting ongoing updates about your campaign’s process. Make sure to time your posts appropriately and maintain consistent messaging in order to avoid flooding your subscriber’s feed with superfluous content.

Tip 5: Optimize Your Pitch Video and Make It Your Channel Trailer

In order to maximize exposure, every aspect of your crowdfunding campaign must incorporate strong and branded visual content. This includes placing a creative pitch video as your YouTube channel’s trailer. Placing your campaign’s trailer at the very top of your channel will generate more traffic and participation in your crowdfunding efforts. Be sure to add annotations to your video that link directly to your campaign page.

Tip 6: Ask Fellow YouTubers for a Shout out

The best way to land online mentions and publicity is simply by asking. Does your network include individuals with prominent YouTube channels or influencers with common values? Ask them for a shout out, link or annotation on your campaign and video.

Josef Holm is the founder and CEO of TubeStart, a crowdfunding platform designed specifically for YouTube content creators. TubeStart provides creators with three funding models, including subscription-based crowdfunding. In addition to being a successful internet entrepreneur and investor, Josef serves on the board of the industry’s leading crowdfunding association, the Crowdfunding Professional Association (CFPA) and speaks at leading technology conferences around the country.

PROVIDE CROWD VALUE

“Kickstarter and Indiegogo have provided a huge platform for companies looking for pre-sales because they provide huge value for the person funding the project. If you can produce something that others want, then promise your funders early access to your product, and they’ll be thrilled to give as long as they get something of value in return.”

HIGH QUALITY VIDEO

“Every time I hear of a successful crowdfunding project, it’s being promoted via a very detailed informational video. First and foremost, the video must introduce the entrepreneur, tell his/her story, and summarize the problem they are solving. The better the quality of the video, the more it will look like you care about your initiative — and that’s what people want to get behind.”

DON’T BANK ON IT!

“While crowdsourcing is an interesting idea that definitely works, the number of companies that are able to rely solely on crowdsourcing to obtain significant funds is still incredibly small. So, companies should not count on crowdsourcing as a primary source of funds, or spend too much time on it to the detriment of other funding strategies.”

STICK WITH SOCIAL MEDIA

“To effectively raise funds and reach your target goal, utilize social media for crowdfunding. There’s just no other way to reach such a massive audience of potential investors without a huge time or financial investment.”

BUILD MOMENTUM BEFOREHAND

“With the proliferation of companies raising money with crowdsourcing, it’s becoming tougher to make a case that you have the product that folks should back. At a baseline you need a compelling story, but beyond that, people always want to back a winner. Build momentum by soliciting backers before you launch your campaign and have them donate early on, as an indication of quality!”

APPROACH EXISTING CUSTOMERS

“If you have an existing customer or membership base, it’s best to approach them first. They already have a vested interest in your company and should be well versed in your products/services, which eliminates a number of initial hurdles.”

The Young Entrepreneur Council (YEC) is an invite-only organization comprised of the world’s most promising young entrepreneurs. In partnership with Citi, YEC recently launched StartupCollective, a free virtual mentorship program that helps millions of entrepreneurs start and grow businesses.

Ok, tell me if you’ve heard this one before. An entrepreneur gets a crazy idea that just might work. She validates through getting out of the office, asking people what they think, and setting up a landing page for her awesome beta. Then she decides to launch a crowdfunding campaign to get some buzz and some funds to keep the dream alive. So far, so good, right?

Now, this entrepreneur has been around the block a bit. It’s her second venture, and she knows that nothing happens on its own. So this entrepreneur studies, and prepares, and does everything she can think of before the campaign to make sure it will be a success.

The big day comes, the campaign launches, and… crickets.

A slow trickle of donations come in from friends and family, a few shares on Facebook and Twitter, and then silence. The momentum grinds to an alarming halt…which is when the panic sets in.

What did she do wrong? Why didn’t all that prep work pay off? Where are all those people who said they loved the idea?

I am, of course, the entrepreneur in the story, so I can tell you that all of your plans and prep may prove useless once you hit that “launch” button.

But I can also tell you what to do better, and how to change all of your marketing and outreach mid-campaign to try to create change. Because no matter what you do, you’re going to have to make a bunch of changes during those first couple of weeks.

Here’s what you can do to go from crickets to traction:

Evaluate, evaluate, evaluate.

I had a plan, and for the first few days I stuck to it. But it was only when I started looking at the analytics for everything I did, that I understood what wasn’t working. In my case I needed to tweak my Facebook ads, cancel my StumbleUpon paid discovery, and consider very carefully whether the people I was reaching on LinkedIn really cared about my project (hint: no).

I also had to look carefully at the actions that brought viewers to the site, the types of comments that got engagements on Facebook, and the types of ads that got clicks. Because of all the analysis, I was able to make quick changes on almost every front: Facebook, Twitter, the Indiegogo page itself, ads, and blogger outreach.

Which brings me to your next big action:

Focus

Once you’ve figured out what works, tighten everything up to include only what is working. Get rid of the rest. You might think that a certain ad will eventually pay off, or your may be in love with your description on the crowdfunding page, but if it isn’t working now it won’t work later. Have the courage to take away everything that isn’t getting results, and pour all of your time and resources into the few actions that are getting results.

I noticed that my Facebook posts only got likes and shares if they had pictures, and that tweets specifically asking for help did better than ones that didn’t. Videos did better than images, and tweets with mentions of key people did better than blanket announcements. I also saw that I needed to reach out to each person multiple times before they would take action.

Let Go

This was the hardest one for me, but this article is proof that I’m now embracing my own lessons.

If you’re too hung up on making everything look great, no one will be able to connect with your story. If I came on here and told you that we launched and saw instant results, and then continued with our plan from the beginning, it wouldn’t be a story. It isn’t interesting, and it isn’t true.

Allow yourself to really connect with your audience by sharing what this journey is like, and how you’re responding to the challenges. If you’ve had a slow day of donations, don’t write an email to your backers saying what a great day it has been. I don’t mean you need to share every detail about the ups and downs, but you do need to let your guard down and be real with people.

Get In There

No one would care if a faceless automaton opened up a crowdfunding campaign with slick marketing and flashy ads. The people backing your campaign want to hear about you and your story. They want to connect with the story of why you’re doing what you’re doing, and who you are as a founder.

Our campaign started out with almost no mention of me and was pretty sterile. But startups aren’t about shiny ads and slick marketing campaigns, they’re about the struggle. We changed our strategy from trying to look like the big guys, to showing our audience how we were working, and the steps we were taking to bring our product to market. I still think we have a long way to go in this area, but we now know how important it is to introduce our future community to the individuals behind the project.

Improve the Ask

When we launched, I thought we would do a lot of asking people for money. And at first we did, but there’s only so many emails you can send that ask people to part with their cash.

I thought about what we really wanted from people. Yes, we hope that they go to our crowdfunding page and contribute, and that is of course important. But we’re also using the campaign to build our community, and for that we need people to like us and want to stick around. One of my advisors put it very nicely when he said, “Money only gives you money, but a devoted follower gives you recognition, a community to talk to, feedback, traction, social proof, many more followers…and also money.”

So we changed from asking for money to asking for things that would help us in the long term – shares, feedback, advice, and criticism. We turned to our friends to ask what could make the campaign better. This made them more likely to head to the site and check it out, to give us truly valuable feedback, and sometimes even ended in a new contribution as well. Once we understood what we were really asking, we were able to connect with more people and begin our (still fairly small) snowball.

Keep Going

This is the most important one. Crowdfunding, as with anything a startup does, is a crazy ride. If you’re doing well it’s insanely busy with answering questions and responding to backers. If you aren’t doing well, it should be insanely busy with figuring out why not, and doing what you can to fix it. But we are entrepreneurs because we stick to it when others would shut off the lights. We believe in our ideas, and we will do what we need to do to get them in front of the world.

You never know which tweet, post, or article will be the one that gets you lots of attention, feedback, and contributions. A random tweet from us led to a conversation via Twitter with Shia LaBeouf, which ended in a donation of $10,000 and a bunch of retweets for our campaign.

I’m not saying this will happen for every campaign, but I can guarantee that it won’t happen if you aren’t putting yourself out there, reaching out to your audience in every possible way, and figuring out the story that you need to tell your backers.

So keep going, evaluate and adapt, and hang on for the ride of your life.

Laura Fredericks is the founder of Describli, a new community connecting readers and writers. She began her crowdfunding journey on October 22nd, and changed everything about it two weeks after launch. She now has modest traction on the campaign, and hopes to continue using her own tips to reach crowdfunding success. You can hear more about her journey on Twitter and Facebook. You can also be awesome and check out Describli’s campaign on Indiegogo.

For every great idea, there are a million verticals, and crowdfunding is no different. Did you know there’s a crowdfunding site specifically for veterans? Are you trying to get a park or sports project funded? There’s one for apps, local communities, and nonprofits.

And now, there’s one for women.

Nap Time Startups is still in early days. CEO Vicki Lemay and her team have only been working on it since March of this year, but they’re already planning a beta launch by December.

So, why do women need a separate crowdfunding platform? Are women not getting funded over at Kickstarter or Indiegogo? Lemay’s answer is that Nap Time Startups will offer a completely different experience from the industry giants. They aren’t just a “platform.” Instead they are seeking to build an ecosystem of support from crowdfunding coaching to advice on financial models.

“When the women entrepreneurs join our crowdfunding ecosystem of business coaches, crowdfunding donors, affiliate mentors/advisors and potential equity investors, we all have the same goal – to achieve success,” Lemay said in an email.

Nap Time Startups also hopes to help donors and investors see the potential in a company or product, which could mean entrepreneurs move beyond crowdfunding into straight investment.

As a mom, the name Nap Time Startups brings up visions of women working away while the kids nap. I asked Lemay if they were targeting moms in particular.

“After so many women entrepreneurs that were not moms with children at home reached out needing crowdfunding and business coaching, we expanded our outreach and are absolutely focused on all women entrepreneurs,” she answered. “Everyone needs a nap, right?”

With such ambitious goals, the team at Nap Time Startups probably does, but they probably won’t be taking one soon. Lemay and her team hope to have the Beta site ready to go by December 5 and are already signing up future users. They also have to plan for their competition. There are a few other women-only crowdfunding sites out there. Plum Alley operates a site that incorporates an e-commerce site so women can sell their wares on the same platform they use for fundraising. Like Nap Time Startups, Chic CEO also aims to incorporate education and support in their platform. And, of course, there are Kickstarter and Indiegogo.

But, we all know that ideas aren’t the most important thing in startups. Execution is. If Nap Time Startups can launch a great site and have great mentorship, they have a shot at creating a unique ecosystem that lots of women will love.

After months of restless anticipation, there is finally some substantial progress towards the implementation of the JOBS Act. It has been exactly one month since the Title II rules- the ones based around general solicitation- went into effect and the SEC is moving forward with implementing the next portion of the monumental legislation.

Title III, the poster child of the JOBS Act, is focused around the sale of private equities in an open market. It is as groundbreaking for the industry as it is controversial in its own right. There are as many proponents of the crowdfunding bill as there are naysayers and today the SEC discussed the proposed rules that would provide the infrastructure for equity crowdfunding to take place. Platforms such as EarlyShares have been waiting for these exact rules in order to set in motion their part in facilitating the sale of private securities.

There have been claims that equity crowdfunding will result in a ‘ghetto stock market’ due to the high risk of fraud and the low barrier to entry. There have also been concerns about the cost of properly keeping up with SEC regulations. Currently, an investment group will spend anywhere between $50,000 and $100,000 in due diligence and this begs the question of how such practices will be handled at a smaller scale for investments that will be under $20,000.

Well, where there is a will there is a way. Solutions are already in place for companies wishing to utilize the new legislation as the SEC continues to implement it. Companies like CrowdCheck provide quick and secure diligence reports while companies such as Crowdentials assist with making sure your investor is accredited among various other compliance needs. Sure, the waters of the JOBS Act regulations are currently a bit murky but there is a lot of money to be made within these environments and those that take advantage of it will be handsomely rewarded. So when can those interested to utilize the new legislations expect to be able to do so? This is where it gets a bit tricky.

Title II of the JOBS Act, which went into effect one month ago on September 23rd, and it allows for companies that are making a private security offering to be able to use public advertising in order to get the word out. While the JOBS Act itself was signed on April 5th, 2012, the SEC didn’t release the proposed rules until July 10th of this year. This seems to be an ongoing trend as the SEC has delayed the implementation of the whole act by several months multiple times.

There is hope that this trend will be broken as the SEC held a live webcast today where the commission discussed the rules surrounding equity crowdfunding. Once these rules are posted to the Federal Registrar (this usually only takes a few days), they will be open for comment and the ball will be rolling to get this brand new industry up and running.

With industry experts waiting to pounce on the opportunity to help out investors and entrepreneurs navigate through the dense regulations of the JOBS Act, those on the fence about joining the crowd should feel a sense of assurance in doing so. CrowdCheck, Crowdentials, and several other industry leaders are poised to iron out the wrinkles as more and more people get involved with Title II and Title III of the JOBS Act.